Bitcoin Weekly Recap 10-23-2015

Bitcoin Weekly Recap 10-23-2015

Bounty Offered for Perpetrators of Bitcoin Ransom Demand

An online retailer in the UK is reportedly offering a £15,000 bounty to anyone who can help the company identify and capture the perpetrators of a hacking and ransom attempt earlier this week. The hackers apparently executed a distributed denial of service attack on the Aria Technology website on Monday afternoon. The criminals behind the attack demanded a ransom payment of 16.66 Bitcoins - more than $4,000 USD.

Rather than pay that ransom, company owner Aria Taheri instead offered the bounty to anyone who would assist in bringing the miscreants to justice. He noted that meeting the attackers’ demands would only serve to encourage such criminal activity by others in the future. The fact that he is offering a bounty nearly five times larger than the amount of money demanded by the attackers is intended to demonstrate that he is more than ready to spend whatever is necessary to see justice done. Bravo, Aria. Bravo.

ACCC Investigating Australian Bitcoin Bank Account Closures

On Monday, news reports from Australia revealed that the Australian Competition and Consumer Commission (ACCC) is in the process of investigating why a number of Australian banks have been targeting Bitcoin businesses for account closure. The Commission’s Chairman, Ron Sims, has confirmed that the actions are related to the banks’ recent actions related to the closing of 13 Bitcoin-related Australian companies - and account closure notifications reportedly sent to at least 4 other similar firms.

The investigation was launched in response to a request by Nationals Senator Matthew Canavan, and is at least partially focused on determining if the banks’ actions constitute anti-competitive behavior. The banks involved in the matter have adopted a strategy of referring all questions about the investigation and the allegation of anti-competitive behavior to the Australian Bankers’ Association. That organization has denied those allegations, and instead claims that the accounts in question were closed because they posed unacceptable compliance risks for banks that already struggle to avoid fines related to money laundering and terrorist financing.

As many outside observers have noted, many of these Bitcoin companies had the potential to disrupt the status quo in the banking sector. The act of de-banking them in this manner could potentially disrupt the emerging cryptocurrency marketplace in Australia, effectively diminishing these businesses’ ability to compete with those larger financial service providers. Moreover, many of the banks involved in the closings are currently researching the technology that enables Bitcoin and other digital currencies - with the intent of using that technology to improve their own money transfer systems. Labor Senator Sam Dastyari expressed concern that these banks might be acting to block the emergence of these businesses, even as they are moving to co-opt Bitcoin’s technology so that they can provide the services themselves.

BitcoinPay’s OpenCart Plugin Enables Online Merchant Bitcoin Payments

BitcoinPay recently announced that merchants using its OpenCart Online Shopping Solution will now have an option for accepting Bitcoin payments on their sites. Registered merchants using BitcoinPay can simply download the plugin, follow the configuration process, and then begin accepting Bitcoin payment from their customers. The new plugin gives those merchants access to several payout methods, including Dollars, Euros, Zloty, and the Koruna. Of course, they’re also free to simply keep the Bitcoins received.

DEA Agent Sentenced For Silk Road Corruption

Ever since the FBI shut down the Silk Road darknet market two years ago this month, the shadowy market’s name has been used in various attempts to tarnish Bitcoin’s reputation. The corrupt activity of two members of the government team involved in the investigation of the affair, however, is something that often receives much less attention. That changed Monday, when a federal judge sentenced former DEA agent Carl Mark Force IV to 78 months in prison after Force pleaded guilty to a host of corruption charges that included money-laundering, extortion, and obstruction of justice.

The other corrupt member of the investigative team, U.S. Secret Service Special Agent Shaun W. Bridges, pleaded guilty to similar money-laundering and obstruction charges in August of this year. His sentencing is currently scheduled for December.

Bi Wang Announces Bitcoin Miner and 14nm Chip for Consumers

Chinese Bitcoin mining company Bi Wang (BW) has announced that it is launching a new 14 nanometer chip and miner - for the consumer market. In case you missed it, DCEBrief’s Thomas Moore covered the story in excellent detail earlier this week: Mining Downsizes to Provide Greater Efficiency for the General Community

Abra announced this week that its money transfer services are about to be available to users in both the United States and the Philippines. In addition, their expanded service will also provide merchants the ability to use the company’s app to accept digital currency payments. As exciting as that news is, however, the investment capital the company is receiving is perhaps just as interesting. As part of its current $12 million round of financing, Abra has received a commitment from American Express.

The financing round also includes investors such as RRE Ventures, First Round Capital, and Tata Sons’ Ratan Tata. American Express is just the latest in a seemingly growing list of financial services companies that are providing investment for new Bitcoin companies - a list that already included major financial giants like Goldman Sachs, the NYSE, and VISA.

China’s CAC Proclaims “Post-Bitcoin Era”

If you haven’t already done so, check out Thomas Moore’s excellent analysis of the recent proclamations from the Cyberspace Administration of China. The CAC recently proclaimed that the post-Bitcoin era has arrived. You can read more about it here: Cyberspace Administration of China Calls for Regulation of Electronic Money as we Move into the ‘post – Bitcoin era’

The investment platform BnkToTheFuture is reportedly assisting Bitcoin Group Limited in its plan to launch its pre-IPA and list shares on Australia’s Securities Exchange next month. Bitcoin Group Limited has already had its plans approved by the Australian Securities and Investment Commission (ASIC), and will unveil its $20 million public offering on November 11, 2015. BnkToTheFuture has already been serving as the company’s investment platform, enabling it to raise more than $30 million in investment this year. This latest news has already elicited positive reaction from observers who anticipate that this public offering will help to not only enhance public awareness of digital currency but help to bring added legitimacy as well.

In a well-reasoned paper available on Deloitte’s website, Jon Watts and several co-authors provide a concise and cogent argument against premature regulation of Bitcoin - and, by extension, digital currency as a whole. He premises his argument on three basic facts:

1. The current interest in regulating Bitcoin far outweighs its current impact on the market. Noting that the total amount of Bitcoins in existence has a value less than $4 billion at present, and that the coin has relatively little market penetration, Deloitte argues that the amount of value presently at risk is not significant enough to warrant this level of regulatory interest.

2. This technology has received strong regulatory attention far earlier than other transformative technologies. Citing technologies such as the telephone, airplanes, radio, the mobile phone, and the internet, Deloitte reminds readers that each had at least two decades of unregulated development before government took an interest. By contrast, Bitcoin has been developing for little more than half a decade.

3. The true transformative power of Bitcoin has not even been realized yet. It is thus premature to institute regulatory schemes that could prevent the truly innovative transformations that are sure to come.

While the paper does not explicitly oppose regulation, it does provide a common sense overview of the major considerations policy makers should take into account as they grapple with the issue of whether or not to enact rigid regulatory schemes to govern the industry.

Author: Ken Chase

Freelance writer whose interests include topics ranging from technology and finance to politics, fitness, and all things canine. Aspiring polymath, semi-professional skeptic, and passionate advocate for the judicious use of the Oxford comma.

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